Sport Law Newsletter – Autumn 2019
Are national team athletes employees?
Employment disputes involving professional athletes, notably the 2011 NBA and the 2012 NHL lockouts, dominated headlines. More recently, employment law and sport collided in a dispute over the employment status of athletes, including national team athletes.
This newsletter addresses the background of this ongoing issue and recent legal developments, specifically the decision of the British Columbia Labour Relations Board that national team athletes are in fact employees.
In Canada, provincial employment legislation generally defines employees as anyone who receives or is entitled to wages for work performed for an employer. Given this definition, when national team athletes are provided compensation through their sport organization, does this compensation represent a wage; and, most importantly, are these athletes employees?
Who qualifies as an employee is defined differently in legislation applicable to non-unionized and unionized workplaces. For example, in British Columbia, an employee in a non-unionized environment is, “a person… receiving or entitled to wages for work performed for another”. In a unionized workplace, an employee is simply, “a person employed by an employer”. In Nova Scotia, non-unionized employees are, “a person employed to do work” while unionized employees are “a person employed to do skilled or unskilled manual, clerical or technical work”.
Some provinces include exemptions for certain types of employees. Exempted employees do not receive the protection of employment legislation.
The definition of “employer” is consistent across the country. Generally speaking, an employer is a person or entity that has control of the work of an individual and is responsible for their employment. The ability to direct and control the actions of employees is a critical factor in determining whether a person or entity is an employer.
Legislation regarding athletes as employees
In the absence of express language exempting a specific type or group of employees, these individuals are treated as employees under employment legislation and benefit from the statutory protections.
Several provinces have introduced amendments to exempt athletes from provincial employment legislation, largely in response to the founding of the Canadian Hockey League Players’ Association (“CHLPA”) in 2012. The CHLPA sought to represent Canadian junior hockey players.
Saskatchewan was first, exempting “athletes while engaged in activities related to their athletic endeavor” from employment legislation in 2014. Nova Scotia followed suit in 2016. Both New Brunswick and Prince Edward Island added their own blanket exemptions for “athletes” in 2017.
The effect of the CHLPA is most obvious in the statutory amendments in Ontario, Manitoba and British Columbia. In Manitoba and British Columbia, “ice hockey players” are explicitly exempted. In Ontario, “major junior ice hockey players” are exempt. In all three provinces, the exemption applies to “junior” or “major junior” hockey players who are entitled to post-secondary scholarships based on their participation with a team.
Quebec’s exemption only applies to “an athlete whose membership in a sports team is conditional on his continued participation in an academic program.” This limits the exemption to university or college athletes.
Only Alberta, Newfoundland and Labrador, and the three Territories do not have exemptions for athletes generally or the narrower ice hockey players exemption.
Can National Team Athletes Unionize?
In January 2019, British Columbia Labour Relations Board (the “Board”) found that members of Rugby Canada’s Senior Men’s Rugby 7s team (the “Players”) were employees of Rugby Canada (“RC”) and eligible to be certified as a bargaining unit.
In Re Canadian Rugby Union and USW, Local 1-1937, 21 CLRBR (3d) 1, the Board considered an application by the United Steel Workers (the “Union”) to certify the Players as a bargaining unit
The key issue was whether the Players were employees of RC. RC’s main argument was that the Players were not employees but rather in a similar category to volunteers, donating their time to the organization. It was argued in the alternative that if the Players were employees, they were employees of Sport Canada, the principal funding source of the Players.
The Board rejected RC’s arguments. The Board defined the general employment relationship as “an employee works in service of their employer’s enterprise, under the direction and control of their employer”, adding that the “employee supplies service in exchange for consideration (usually in the form of wages)”. No exemption applied, as British Columbia’s legislation only exempts ice hockey players.
The Board found that the Players were paid wages for their work. The compensation available to the Players, including Sport Canada’s Athlete Assistance Program – which was only available to athletes chosen and nominated by RC – as well as appearance fees, win bonuses, and training support payments made by Rugby Canada was remuneration for services rendered.
The Board highlighted the Athlete Agreement, finding that both sides had clearly intended to create a contractual relationship. The Athlete Agreement included terms and conditions relating to funding, training, volunteering, and promotional appearances, as well as setting out a disciplinary policy and process.
Given their findings on remuneration, the degree of direction and control established through the Athlete Agreement, the Board found that the Players were employees of RC and that the Players are eligible to unionize. The Board ordered that the application proceed.
On July 5, 2019, the Board denied RC’s application for reconsideration of the January decision.
RC’s application was based upon three objections: that the finding that the Players were employees was inconsistent with British Columbia’s legislation; that the proposed unit was not appropriate for collective bargaining; and finally, that if the Players were found to be employees, the employment relationship should fall under federal, not provincial jurisdiction.
These objections failed to convince the Board to reconsider the original decision. It is noteworthy that RC’s application for reconsideration placed a much higher emphasis on the “amateur” status of the athletes and the sports organization involved.
RC argued that the original decision failed to properly appreciate the relationship between amateur athletes and their sports organizations. In denying RC’s “employee objection” the Board noted that it was not established “that the Players were so predominantly amateur athletes that they could not or should not be considered employees covered by the Code”. This finding could prove significant as it indicates that an athlete’s ‘amateur’ status does not bar them from being classified as an employee.
It is also important to note that twenty-five national sport organizations, including Alpine Canada, Canoe Kayak Canada, Curling Canada, Hockey Canada, Sail Canada, and Skate Canada sought to file written submission as a group during the reconsideration process.
Every organization, except Hockey Canada, filed identical submissions to the Board, claiming that the Board’s finding that the Players were employees of RC has “as serious implications for all amateur sports organizations in Canada.” The Board denied this request.
RC applied for judicial review of the Board’s January decision in early September 2019.
Potential Impact and Next Steps
Classifying and treating national team athletes as employees would have a widespread impact on national and provincial sport organizations. The most obvious implication is financial. For some organizations, paying players a set wage is manageable, while for others it could be highly problematic given the current funding arrangement through carding with Sport Canada.
Further, the practical realities of classifying athletes as employees, with the accompanying legal implications, will be significant. Potential complications will arise in actions such as discipline and team selection, particularly given the complexity of qualifying national positions and subsequent selection for these spots.
Provincial governments may take action to address this issue. For example, British Columbia could change their legislation again to expand exemptions to all athletes as opposed to simply exempting “ice hockey players”.
While the Board’s decision is under appeal, this decision is only the latest round in the ongoing debate surrounding the issue of athletes and their employment status in Canada. It is clear that the accepted understanding of the relationship between athletes and sport organizations is poised for a shift. This issue is far from settled and further developments are expected.
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